Economic Development Becomes a Priority for Local Communities in Moldova

In 2017, EU launched the “Mayors for Economic Growth” (M4EG) Initiative in the Eastern Partnership countries aiming at supporting local communities develop their economic potential. Over a period of two years, 28 localities from Moldova joint the Initiative, committing themselves to creating partnerships at local level, to elaborating local economic development plans and to implementing them successfully. The M4EG Initiative Coordinator in Moldova, Lilian Danilov, and the Expert for Moldova, Diana Nastas, explained during an interview what makes this Initiative so valuable and why it is important for localities to become drivers of sustainable economic growth.

- What makes Moldova a special case when talking about the M4EG Initiative?

Diana Nastas: Moldova is special thanks to the people who work in local public authorities. We were astonished to discover so much enthusiasm among local officials, at least, among the people with whom we collaborate directly. Opening the parentheses, I would like to mention that all the mayoralties that signed the Initiative have appointed a person responsible for the project, called Local Economic Development Consultant. Hence, the quality of people working in local authorities makes Moldova special. We collaborate with persons of different age – 25, 50, and 60 years old, and we have noticed a strong motivation and enthusiasm within all age groups.

Lilian Danilov: We have discovered sufficient competence at the local level. It all depends on whether there are proper conditions or not for civil servants to develop these competences. It is a stereotype that people working in local public administrations are more conservative. On the contrary, we have seen that locally elected officials and local civil servants are open to learn new things. We have to look at every community individually and ensure sufficient conditions for every community to be able to materialize its potential.

- What do you think is your main achievement as M4EG Initiative Coordinator in Moldova?

Lilian Danilov: I am glad that we managed to build a community of mayors for whom economic development became a priority, in which local authorities want to invest time and resources, and skills. At present, 28 communities of different levels – small communities, municipalities, rayons and regions – joined the M4EG Initiative, and thus, the establishment of this professional community is a big achievement. We also consider that it is important that Moldovan communities are successfully implementing 3 economic development projects that directly contribute to improving the infrastructure and business support services as part of the Initiative.

Diana Nastas: The mayors have acknowledged that just a well-established physical infrastructure, which implies the existence of sewerage, gas supply, and waste management systems, does not represent anymore an incentive for people to remain in the locality. As long as there are no well-paid jobs, people will leave. When a mayor fully acknowledges this, local economic development becomes a priority for him/her for the following years. We consider such cases to be a big achievement of the Initiative.

- What was the main challenge you have encountered in your activity?

Lilian Danilov: There were certainly different challenges, but the turnover of specialists – I mean the consultants appointed by local authorities to support the efforts undertaken by the Initiative - within local administrations was and remains to be the most stringent one. People with whom we have worked for a while leave, and then we have to start everything from scratch again, and this is not easy at all.


- What does actually local authorities’ involvement in the M4EG Initiative imply?

Lilian Danilov: Upon joining the M4EG Initiative, the community commits to develop a Local Economic Development Plan. The main element is establishing partnerships between the public administration and local business environment. We provide trainings and assistance for stakeholders to understand the local economic development concept and approach. Subsequently, the document itself is drafted, to be implemented later. One of the advantages of the Initiative is developing networking activities among community members at the national and regional levels among Eastern Partnership countries. Recently, five regional networks were established in five areas – support to business, agriculture, tourism, IT and wine industry. Therefore, community members can communicate and exchange experiences, set up collaborations, and even jointly apply to programs financed by various donors.

- How many M4EG Initiative members succeeded to develop local economic development plans?

Lilian Danilov: This is another major achievement of the project. 13 out of 28 signatories of the Initiative developed local economic development plans. Initially, these plans are evaluated by us, afterwards, they are submitted to the M4EG Initiative Secretariat and sent to World Bank experts for final assessment. All 13 documents were approved by the experts, and were deemed to be compliant with the principles and approaches of the Initiative.

Diana Nastas: Local authorities commit to develop a local economic development plan for a period of two years, which should include exclusively activities that they are sure they will implement during the respective period of time. If they have doubts about not identifying financing sources or not being able to implement a certain activity, we recommend them not to include it. A final evaluation criterion would be for at least 75% of the envisaged activities to be carried out.

Lilian Danilov: It should be mentioned that economic development occurs anyway. The private sector, entrepreneurs develop their business. What we are trying to point out is that the public sector can have an important role in encouraging the development of the business sector in the community. Hence, it is very important for us to have collaboration between the public and private sectors in this effort for economic growth at the local level and for them to formulate a vision for community development together.

-What actions are undertaken to ensure the continuity and sustainability of activities, even after the completion of the Initiative? How do you convince the authorities that the change should continue?

Diana Nastas: We create a practice of cooperation between the public and private sectors at the local level. These two sectors are learning how to collaborate, communicate and identify development solutions together. At least half of the participants of the so-called Local Economic Development (LED) Partnership should be representatives of the private sector.

This LED Partnership is responsible for drafting local economic development plans, which includes generation of ideas, identification of development priorities, elaboration of the locality development vision for the next 5 years. Depending on the strategic vision mutually agreed between these actors, an Action Plan is subsequently developed, which has to be implemented jointly with the private sector. Once the practice of collaboration is implemented for two years to both parties’ satisfaction, more trust will be established between them, and they will likely continue cooperation.

The first meetings were difficult because of no previous practice of communication between the public and private sectors. Businessmen did not trust and did not see the point in attending a mayoralty meeting. They were saying that the mayoralty had not been interested in a dialogue with them, not had it asked about the opinions of the private sector about local development and they were wondering why would it do it now? This made them reluctant, but the level of trust has increased subsequently. This makes us believe that such collaborative practices will continue after the completion of the project.

Lilian Danilov: The focus of the M4EG Initiative is on local teams, on establishing sustainable partnerships and developing realistic documents for the community, where the vision matches the resources, potential and commitment of public and private sectors to achieve their objectives. We consider these three elements – local team, public-private partnership and local development plans – to be very important for creating an attractive business environment at the local level.

-Do you have a memorable case in your working experience within the M4EG Initiative?

Lilian Danilov: There were several situations that impressed us. The one that we want to mention is the activity of the local consultant from Balti municipality, who took his annual leave from work in order to finish the drafting of the economic development plan and dedicated himself completely to this process. We were really impressed with so much dedication. It means that this exercise really matters to them. He changed his annual leave for this effort, and he deserves credit for it.

Diana Nastas: Another memorable case happened with one of our signatories – Carpineni mayoralty. Usually, the work of a mayoralty is very intense, with employees involved the whole day in activities with citizens. It is obvious that drafting local development documents represents an additional task, which requires time and effort. At the end of the work day, the persons involved in drafting the plan went home, had dinner, and came back to the mayoralty to work on the plan. And they wrote such a simple, well-thought and structured document, that they could not have gotten anything else but ‘Excellent’ by the experts of the World Bank.

Lilian Danilov: During these two years, we were convinced that there are capacities and willingness for the representatives of local public administrations to enhance their potential further on. It is not only the fact that they are part of this Initiative that matters to us, but also the reality that economic development becomes a priority for these communities.